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In late January, several hundred business, community and
elected leaders from the greater Richmond
region
gathered to hear Richard Florida, author of The
Rise of the Creative Class, describe how most
economic development programs and
strategies are outdated and even counterproductive
to building economies for the 21st Century. Florida,
a professor of economic development at Carnegie
Mellon
University
in
Pittsburgh, has frequently
been quoted for his contrary opinions about the
public policy aspects of economic development.
Florida
has derived his theories
about economic development through his study of
“successful” communities which boast of a
combination of economic dynamism, cultural richness,
population diversity, educational excellence and
reputations as "good places to live, work and
play.” His
laboratories are places such as San
Francisco/Silicon Valley, Austin,
San
Diego
and other places which are generally cited as
successful and desirable communities.
Based on his analysis, Florida
advocates a formula for attracting and cultivating
the growth of the “creative class,” the
principal driver, he claims, of our modern-day
economy. According
to Florida,
although the creative class comprises just 38
percent of the working population, it accounts for
more than 50 percent of the gross economic impact of
the entire economy. Most
cities, regions and states still try to attract the
traditional manufacturing sector -- a practice in
economic development circles commonly referred to as
“buffalo hunting” -- based on the perception
that investment in plant and capital, and creation
of skilled jobs, will result in economic superiority
and stability. He
contends that one need only look at Pittsburgh,
where he has taught at Carnegie Mellon for many
years, to see the flaws in these types of economic
development strategies.
Richard Florida sells his case in an entertaining and often
provocative style. “Companies
today are not induced to make location decisions
because of incentives and tax breaks,” he stated,
referring to a statement recently made by
Hewlett-Packard CEO Carly Fiorina to a gathering of
state governors. Rather, Florida
reported, Fiorina said companies like hers are more
motivated by the quality of the workforce, and she
curtly advised the Governors to “keep your tax
breaks.”
Admitting
that his next suggestion would be viewed as outrageous, Florida
said communities might do better to offer incentives
to “attract gays and those who increase the
bohemian index of their community,” a yardstick he
and his students derived to measure the intangible
factors of diversity, tolerance and other quality of
life features the creative class seeks when
considering where to live, work and play.
Florida’s suggestions may be somewhat naïve: They ignore
real-world competitive forces that communities,
regions and states feel when they are faced with
plant closures, recessions or trade agreements that
suddenly render their economic base noncompetitive.
However, the central theme of his message is
relevant to most communities -- and particularly to
Richmond.
I
agree with Florida that
communities should pay more attention to growing an
indigenous base of industries, and instead of
buffalo hunting, spend more time supporting the expansion
of existing businesses and create a community-wide
infrastructure to foster entrepreneurship and the
start-up of new “creative” companies. This
is precisely what the Virginia
Bio
Technology
Research
Park
is attempting to do, thereby helping the region
enhance its standing as an emerging center for the
biosciences industry.
The Virginia
Bio
Technology
Research
Park,
a partnership of Virginia
Commonwealth
University,
the City of Richmond
and the
Commonwealth
of Virginia, is
located on 34 acres in the middle of downtown
Richmond,
immediately adjacent to the VCU
Medical
Center.
Today, 10 years since planning was first
advanced by Richmond Renaissance and a group of
local business leaders, the Park is currently home
to more than 42 private sector bioscience companies,
several non-profits, three research institutes of
VCU and four major state laboratories.
This
“science park” is only one-third developed, yet
it is already becoming a dynamic center of research,
commerce and community revitalization far exceeding
the expectations of the founding partners who asked
Eugene P. Trani to be the champion for creating the
biotechnology research park.
Jim Bacon, publisher of “Bacon’s Rebellion,” recently
opined ("The
Next Big Thing," December
23, 2002
)
that “it may be too late for Virginia
to become a world leader in biotech, but leadership
in the delivery of medical services is still within
our grasp.” I
would agree with the second part of his premise, but
challenge his write-off of biotech as premature.
True,
it may be difficult to become a world leader in
biotech, given the entrenched positions of San
Francisco, Boston, San Diego and a few other places.
However, Richmond can become one of the preeminent
“second tier” bioscience centers if we
capitalize on our assets and quickly move to address
the shortcomings which are preventing Richmond --
and Virginia -- from achieving national or even
international stature.
The very factors that Florida
advocates for attracting the creative class are many
of the same factors which scientists and
entrepreneurs involved in biotechnology also seek.
Richmond’s
reputation for excellent quality of life, the
resurgence of downtown, arts, culture and
entertainment and other factors all contribute to
our current-day "creative" infrastructure.
Chief among these is the presence of a major
research university and academic institution, VCU,
which not only has a reputation for excellence, but
also is recognized for its diversity, affordability
and improving educational experience for its
students. VCU distinguishes
Richmond
from many other cities and regions which would like
to “get in the biosciences game” but lack a
comparable institution.
Other
features have historically have made Richmond an
attractive location to live and do business. The
always intangible “quality of life” is why so
many transplants here choose to stay
when business obligations would otherwise force them
to relocate. Likewise,
it's the reason that many individuals who
have lived in here
at
some point in their past are plotting a way to
return.
Finally, visible signs of a dramatic downtown
revitalization -- the new Convention Center, Canal
Walk, Biotech
Park,
VCU expansion on both campuses, Jackson Ward and the
planned Arts Complex -- all demonstrate that the
region is investing in its center city as the unifying common “place.”
Despite
these qualities, Richmond
suffers from some competitive disadvantages in the
biosciences. Chief
among these is a woefully inadequate
supply of venture capital to fuel the growth of this
industry. The
principal reason that acknowledged centers of
biotechnology activity such as San Francisco, San Diego
and Boston
have developed successful clusters of bioscience
activity is the ready availability of private
capital with an appetite for life sciences
companies. We
have already experienced companies that have been
successfully “born” and incubated at the
Virginia BioTechnology Research Park that are now
maturing in locations like Denver, Columbus and
elsewhere out of state.
A second challenge the region faces in distinguishing
itself as a 21st Century center for the
biosciences is a demonstrable ability to supply the
type of future workforce to fill jobs as they are
created. Not
all jobs in the biotechnology, pharmaceutical and
other life science industries require Ph.Ds.
All jobs, however, are considered highly
skilled positions with computer, communication and
other basic skills required simply for entry.
Globally, the biotechnology industry is still relatively
young, and few companies have reached the point
where they annually require hundreds or even
thousands of workers to fill positions over a
relatively short period of time.
Nevertheless, biosciences companies not only
look carefully at the quality of a community’s
educational system, but want assurance that students
are receiving preparation in the core areas of math,
science and English that are the building blocks to
the college-level courses in biology, chemistry,
calculus and computer sciences.
Richmond must do a better job of acquainting
children at the earliest stages of their K-12
education -- and even before -- with the
significance of the life sciences revolution to them
and their children, even if they do not pursue
careers directly in the industry.
Lastly, construction of the highly specialized laboratory
and research facilities is a continuing challenge.
Companies that require wet laboratory and
other types of highly specialized research space
cannot easily go into standard commercial types of
office and industrial space. Further, given the fact many of these
companies are still very young, they do not have a track
record, and are highly dependent on venture capital
makes them a problematic risk for the private
sector. The Virginia
Bio
Technology
Research
Park
addresses this problem by providing space for incubation and
successful launch of these companies, and nurturing
them through the critical
early years.
Eventually,
companies will prove their products in the
marketplace. Then they become candidates for one of the
Park’s satellite locations in Chesterfield
and Henrico
counties.
We can seed the development
of the industry in the metropolitan area through
planned development of biosciences step-up and
speculative wet laboratory space in order. The specialized nature
of the facilities, largely unavailable in the
Mid-Atlantic region, may attract some companies. Fulfilling this need will require cooperation
from the state and local government
partners, but experience has demonstrated that the
risks are manageable and the long-term rewards are
potentially significant.
Greater
Richmond: the new East Coast center for the
biosciences. We
have most of the ingredients in place. It's
within our means to address the
shortcomings. It is an exciting vision and one that the
community should embrace as a part of the greater
Richmond
area’s economic development
strategy for the 21st
Century.
--
February 24, 2003
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